Chapter 1 Role of Services in an Economy 大同大學 林淑瓊 [email_address]
Identify traits that all services have in common.
Discuss the central role of services in an economy.
Identify and differentiate the five stages of economic activity.
Describe the features of preindustrial, industrial, and postindustrial societies.
Describe the features of the new service economy .
Contrast the push vs. pull theories of innovation.
Identify the sources of service sector growth.
Services are deeds , processes, performances .
Valarie Zeithaml & Mary Jo Bitner
A service is a time-perishable , intangible experience performed for a customer acting in the role of a co-producer.
Definition of Service Firms
Service enterprises are organizations that facilitate the production and distribution of goods , support other firms in meeting their goals, and add value to our personal lives.
Role of Services in an Economy 1- BUSINESS SERVICES · Consulting · Auditing · Advertising · Waste disposal INFRASTRUCTURE SERVICE · Communications · Transportation · Utilities · Banking PERSONAL SERVICES · Healthcare · Restaurants · Hotels CONSUMER (Self-service) GOVERNMENT SERVICES · Military · Education · Judicial · Police and fire protection DISTRIBUTION SERVICES · Wholesaling · Retailing · Repairing FINANCIAL SERVICES · Financing · Leasing · Insurance MANUFACTURING Services inside company : · Finance · Accounting · Legal · R&D and design
Percent Employment in Services Top Ten Postindustrial Nations 1- Country 1965 1975 1985 1995 2005 United States 59.5 66.4 70.0 74.1 78.6 United Kingdom 51.3 58.3 64.1 71.4 77.0 The Netherlands 52.5 60.9 68.3 73.4 76.5 Sweden 46.5 57.7 66.1 71.5 76.3 Canada 57.8 65.8 70.6 74.8 76.0 Australia 54.6 61.5 68.4 73.1 75.8 France 43.9 51.9 61.4 70.0 74.8 Japan 44.8 52.0 57.0 61.4 68.6 Germany 41.8 n/a 51.6 60.8 68.5 Italy 36.5 44.0 55.3 62.2 65.5
Trends in U.S. Employment by Sector 1-
Distribution of GDP in the US Economy 1- Product Services Physical Information 6% 10% 31% 53% 37% 63% 84% 16% D B A C
Stages of Economic Development
Pre- Use of Standard
dominant Human Unit of of Living
Society Game Activity Labor Social Life Measure Structure Technology
Pre- Against Agriculture Raw Extended Sub- Routine Simple hand
Industrial Nature Mining muscle household sistence Traditional tools power Authoritative
Industrial Against Goods Machine Individual Quantity Bureaucratic Machines
fabricated production tending of goods Hierarchical
Post- Among Services Artistic Community Quality of Inter- Information
industrial Persons Creative life in terms dependent
Economic Evolution 1- Economy Agrarian Industrial Service Experience Economic Offering Food Packaged goods Commodity service Consumer services Business services Function Extract Make Deliver Stage Co-create Nature Fungible Tangible Intangible Memorable Effectual Attribute Natural Standardized Customized Personal Growth Method of Supply Stored in bulk Inventoried Delivered on demand Revealed over time Sustained over time Seller Trader Producer Provider Stager Collaborator Buyer Market Customer Client Guest Collaborator Expectation Quantity Features Benefits Sensations Capability
The Four Realms of an Experience 1-
Source of Service Sector Growth
Information Technology (e.g. Internet)
Innovation Push theory (e.g. Post-it) Pull theory (e.g. Cash Management)
Services derived from products (e.g. Netflix)
Exploiting information (e.g. Auto part sales)
Difficulty of testing service prototypes
Changing Demographics Aging of the population Two-income families Growth in number of single people Home as sanctuary
Typology of Services in the 21 st Century 1- Core Experience Essential Feature Examples Creative Present ideas Advertising, theater Enabling Act as intermediary Transportation, communications Experiential Presence of customer Massage, theme park Extending Extend and maintain Warranty, health check Entrusted Contractual agreement Service/repair, portfolio mgt. Information Access to information Internet search engine Innovation Facilitate new concepts R&D services, product testing Problem solving Access to specialists Consultants, counseling Quality of life Improve well-being Healthcare, recreation, tourism Regulation Establish rules and regulations Environment, legal, patents
Illustrate how the type of work he or she does influences a person’s lifestyle .
For example, contrast a farmer, a factory worker, and a school teacher.
Is it possible for an economy to be based entirely on services ?